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Message Boards Digest

November 14, 2018

Here are the most recently added topics on the BenefitsLink Message Boards:

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ZakOregon created a topic in Defined Benefit Plans, Including Cash Balance

Premature Termination of Defined Benefit Plan

I have a small business LLC S-Corp. I have a one person defined benefit in place for the last 5 years. Funded until 2017. In 2018, I am unable to fund the required amount owing to significant personal losses and am considering closing the LLC. I was told by my retirement plan folks that there would be an excise penalty and would still have to fund 2018. That doesn't sound right. What is the penalty and the process of closure?
Number of replies posted  1 reply      Number of times viewed  38 views      Add Reply
 
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JackS created a topic in Retirement Plans in General

Top Heavy Status: Related Rollovers

An employer sponsored a 401k plan long ago -- pre-2010. They terminated the plan and everyone was distributed. The employer then started a Simple IRA and has been using that ever since. They have discontinued the Simple IRA and want to start a 401k again for 2019 (traditional 401k, non safe harbor). The new plan would be treated as NOT Top-Heavy because all the distributions were more than 5 years ago. The owner wants to roll over money from an IRA that contains the original distribution from the prior plan. Would doing this make the plan TH immediately (assuming his account is more than 60% of the EOY account balances)? I am thinking that it would be a related rollover, and that by putting it back into a plan sponsored by the same employer, it would have to be counted in the TH calculation. Agree?
Number of replies posted  1 reply      Number of times viewed  32 views      Add Reply
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ESI2015 created a topic in 401(k) Plans

Compliance Calendar for Plan Year Ending June 30

Would anyone have a calendar of important plan due dates for a non-calendar year plan? Specifically for one that ends each June 30? It's easy to find material to give to a client on due dates for a calendar year plan but I'm not seeing any such material for non-calendar year plans.
Number of replies posted  0 replies      Number of times viewed  17 views      Add Reply
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MarZDoates created a topic in 401(k) Plans

SHNEC Deposit for 2017 Plan Year Not Made Until Now

Plan sponsor has not made their safe harbor non-elective contribution deposit for the 2017 Plan Year. They have until 12/31/18 to make the deposit and keep the safe harbor status for 2017, correct? I'm not sure if they deducted it on their 2017 tax return, but it would not have been deductible since it was not made by their 2017 tax filing deadline. [1] Is it deductible for 2018? [2] Do we have to apply lost earnings?
Number of replies posted  5 replies      Number of times viewed  61 views      Add Reply
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SSRRS created a topic in Defined Benefit Plans, Including Cash Balance

Allocating Contributions

A corporation made numerous contributions to its DB plan during the months of January through September 2018. These contributions can either be used for the 2017 year (of course must be within the min/max range) if made by the extended due date of 2017 return, being Sept. 15, 2018, or for the 2018 year. Can the corporation use contributions made in January, February, and June 2018 for the 2017 tax year and then use contributions that were made in March, April and May 2018 for the 2018 tax year, or must they go in order (i.e., contributions made from January through April 2018 for the 2017 tax year and then contributions made from May 2018 through Sep 2018 for the 2018 tax year)?
Number of replies posted  2 replies      Number of times viewed  23 views      Add Reply
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K2 created a topic in Retirement Plans in General

Funding a DC Plan Over Several Years Using Excess Assets from Terminated DB Plan

Our client terminated their defined benefit plan. There are excess assets that they want to roll into their 401k plan and allocate, ratably over the next seven years, as a profit sharing contribution. I don't see any language in my document that covers this kind of "suspense" account, or whatever I should call it. Does anyone else know of a document provider whose plan has language that supports this qualified replacement plan?
Number of replies posted  1 reply      Number of times viewed  26 views      Add Reply
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poisnivey created a topic in Defined Benefit Plans, Including Cash Balance

Uncashed Pension Checks

In a defined benefit plan, we located missing participants and validated current address. They were non responsive to begin their benefit so we defaulted their election and began payment. Two participants, who are 70.5, have not cashed their checks. Do I stop payment and not reissue so that a 1099 is not generated or should we continue making payments knowing the checks aren't being cashed?
Number of replies posted  1 reply      Number of times viewed  19 views      Add Reply
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